New Zealand’s fiscal accounts remain healthy by global comparison with the Government bringing down a Budget that attempts to meet the Wellbeing criteria by increasing spending in key social areas while at the same time maintaining rising budget surpluses and falling net debt.
Operational spending rises $15 billion over the next four years with the spending allowance for 2019 raised to $3.8 billion with $3.0 billion allowed for 2020. That’s up from the previous allowances of $2.4 billion for each of those years. That makes fiscal policy a tad more stimulatory (to be precise, slightly less contractionary compared to previous forecasts) over the next few years than we have been assuming.